It is understood Southern Cross was interested in the MediaWorks radio business, which includes stations such as The Edge, The Sound, The Greeze, The Rock and Magic and operate in 23 markets across New Zealand.

Southern Cross chief executive Grant Blackley. Scott Barbour

However, MediaWorks owns a television business, which includes TV3 and Four, which it also wanted to sell. But Southern Cross is believed to have had no interest in those assets, and negotiations have ended.

Related Quotes

Sources said in initial negotiations Oaktree was amenable to selling just MediaWorks' radio assets, and would find another buying for the TV assets. However, it's believed the private equity firm had a change of heart and wanted a whole-of-company offer for MediaWorks, something Southern Cross is not interested in.

Southern Cross declined to comment.

Mr Blackley is known to be hunting acquisitions where it could leverage its existing businesses, expertise and intellectual property. Southern Cross radio assets include The Hit Network and Triple M.

Oaktree, a US-based distressed debt hedge fund, took full ownership of MediaWorks in 2015, buying out other shareholders.

MediaWorks is run by former Austereo boss Michael Anderson, who is also a former chairman of out-of-home advertiser oOh!Media and TV ratings measurement provider OzTam as well as a non-executive director of Fairfax Media, publisher of the Financial Review.

Southern Cross has previously approached NZME about its radio assets, but it was not able to engage due to exclusive merger talks between NZME and Fairfax Media NZ.

Since becoming chief executive in 2015, Mr Blackley focused heavily on paying down debt and selling non-core assets so Southern Cross can focus on radio, which has weathered much of the downturn in media advertising.

Topics

Max Mason is The Australian Financial Review’s Media & Marketing editor. Based in our Sydney newsroom, Max is an award-winning journalist with nearly a decade of experience across a range of major publications. Connect with Max on Twitter. Email Max at max.mason@afr.com